SHFL Entertainment, Inc. v. Digideal Corporation

Filing 143

ORDER that Defendant's 124 Motion to Vacate Injunctive Relief is GRANTED. Plaintiff's 135 Motion to Strike is DENIED as moot. Defendant's 123 Motion for Summary Judgment is GRANTED. Judgment is entered in favor of Defendant and against Plaintiff. The Clerk of the Court shall enter judgment accordingly and close the case. Signed by Chief Judge Gloria M. Navarro on 3/30/2016. (Copies have been distributed pursuant to the NEF - SLD)

1

UNITED STATES DISTRICT COURT

2

DISTRICT OF NEVADA

3
4

SHFL ENTERTAINMENT, INC., a
Minnesota corporation,

5

Plaintiff,
vs.

6
7
8

DIGIDEAL CORPORATION, a Nevada
corporation,
Defendants.

9

)
)
)
)
)
)
)
)
)
)
)

Case No.: 2:12-cv-01782-GMN-VCF
ORDER

10
11

Pending before the Court is the Motion for Summary Judgment (ECF No. 123) and the

12

Motion to Vacate Injunctive Relief (ECF No. 124) filed by Defendant Digideal Corporation

13

(“Defendant”). The instant Motions have been fully briefed.

14

I.

15

BACKGROUND
This case arises from Defendant’s alleged infringement of United States Patent No.

16

6,651,982 (“the ’982 Patent”), titled “Card Shuffling Apparatus With Integral Card Delivery,”

17

and United States Patent No. 7,523,935 (“the ’935 Patent”), titled “Card Shuffling Apparatus

18

With Integral Card Delivery” (collectively, “the Asserted Patents”). (Am. Compl. ¶¶ 6–7, ECF

19

No. 67). See generally United States Patent No. 6,651,982 (filed Apr. 23, 2002); United States

20

patent No. 7,523,935 (filed Oct. 15, 2003). Plaintiff has asserted Claims 1–3, 42–44, and 46 of

21

the ’982 Patent, and Claims 1, 2, 9–11, and 14 of the ’935 Patent. (Pl.’s Opening Claim

22

Construction Br. 11:16–17, ECF No. 60).

23

Plaintiff SHFL entertainment, Inc. (“Plaintiff”) is “a global gaming supplier based in

24

Clark County, Nevada that . . . manufactures, sells, and leases gaming products including

25

automatic card shufflers, proprietary table games, electronic table games, video slot machines

Page 1 of 6

1

(not for sale in North America), deck verification devices, card delivery dispensers, and roulette

2

chip sorters.” (Am. Compl. ¶ 8). The card shuffler technology incorporated in many of

3

Plaintiff’s card shuffler products, including the Deck Mate and the Deck Mate 2, is an

4

embodiment of the claims of the Asserted Patents. (Id. ¶¶ 10, 11).

5

Defendant also “manufactures and markets gaming equipment including at least

6

marketing an automatic card shuffler known as the DigiShuffle.” (Id. ¶ 12). In the Amended

7

Complaint, Plaintiff alleges that, “[o]n September 24, 2012, SHFL provided notice to DigiDeal

8

that the DigiShuffle appeared to have features similar to those found in and encompassed by,

9

among others, the claims of the Asserted Patents.” (Id. ¶ 14). Plaintiff further alleges that it

10

explained to Defendant that Plaintiff’s Deck Mate product was patented. (Id.). Additionally,

11

Plaintiff asserts that Defendant exhibited the accused device at the “2012 Global Gaming Expo

12

(“G2E”) in Clark County, Nevada,” “where the DigiShuffle was displayed, used, and offered

13

for sale to potential customers” and that, “[s]ince G2E, DigiDeal has continued to offer for sale

14

the DigiShuffle in the United States.” (Id. ¶¶ 13, 15, 18).

15

On April 17, 2014, the parties filed a Stipulation and Order to Stay, requesting that the

16

Court grant a stay pending the final disposition of the United States Patent and Trade Office’s

17

(“USPTO”) ex parte reexaminations of the Asserted Patents. (Stip. Stay ¶ 2, ECF No. 100).

18

That same day, the Court entered an Order granting the Stipulation and Order to Stay. (ECF

19

No. 101). On November 13, 2015, Plaintiff filed a Motion to Lift Stay, requesting that the

20

Court lift the stay based on the completion of the reexaminations of the Asserted Patents. (Mot.

21

Lift Stay 3:4–5, ECF No. 117). Shortly thereafter, Magistrate Judge Cam Ferenbach entered an

22

Order lifting the stay and directing the parties that “an appropriate request for dispositive

23

adjudication based on the results of the reexamination of the patents-in-issue must be filed on

24
25

Page 2 of 6

1

or before on or before January 8, 2016, to be briefed in the ordinary course.”1 (Order 1:23–25,

2

ECF No. 121). Accordingly, Defendant timely filed the instant Motions.

3

II.

4

LEGAL STANDARD
The Federal Rules of Civil Procedure provide for summary adjudication when the

5

pleadings, depositions, answers to interrogatories, and admissions on file, together with the

6

affidavits, if any, show that “there is no genuine dispute as to any material fact and the movant

7

is entitled to judgment as a matter of law.” Fed. R. Civ. P. 56(a). Material facts are those that

8

may affect the outcome of the case. See Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 248

9

(1986). A dispute as to a material fact is genuine if there is sufficient evidence for a reasonable

10

jury to return a verdict for the nonmoving party. See id. “Summary judgment is inappropriate if

11

reasonable jurors, drawing all inferences in favor of the nonmoving party, could return a verdict

12

in the nonmoving party’s favor.” Diaz v. Eagle Produce Ltd. P’ship, 521 F.3d 1201, 1207 (9th

13

Cir. 2008) (citing United States v. Shumway, 199 F.3d 1093, 1103–04 (9th Cir. 1999)). A

14

principal purpose of summary judgment is “to isolate and dispose of factually unsupported

15

claims.” Celotex Corp. v. Catrett, 477 U.S. 317, 323–24 (1986).
In determining summary judgment, a court applies a burden-shifting analysis. “When

16
17

the party moving for summary judgment would bear the burden of proof at trial, it must come

18

forward with evidence which would entitle it to a directed verdict if the evidence went

19

uncontroverted at trial. In such a case, the moving party has the initial burden of establishing

20

the absence of a genuine issue of fact on each issue material to its case.” C.A.R. Transp.

21
22
23
24
25

In the Order granting the Stipulation and Order to Stay, the Court provided that, “[d]uring the pendency of the
stay of this action and in the United States, DigiDeal, its successors and assigns, or any party in active concert or
participation with DigiDeal, shall not manufacture, market, lease, offer to sell, sell, or place with any customer
the accused DigiDeal card shuffler (i.e., the DigiShuffle), or any substantially similar automatic card shuffler,
including the manufacture of the components of the DigiShuffle for assembly outside of the United States.
DigiDeal also shall immediately take steps to remove any DigiShuffle card shuffler that is currently operating
and/or has been installed for any customer.” (Order ¶ 4, ECF No. 101). However, because the stay has been
lifted, this provision is no longer in effect. Accordingly, the Court grants Defendant’s Motion to Vacate
Injunctive Relief (ECF No. 124).
1

Page 3 of 6

1

Brokerage Co. v. Darden Rests., Inc., 213 F.3d 474, 480 (9th Cir. 2000) (citations omitted). In

2

contrast, when the nonmoving party bears the burden of proving the claim or defense, the

3

moving party can meet its burden in two ways: (1) by presenting evidence to negate an

4

essential element of the nonmoving party’s case; or (2) by demonstrating that the nonmoving

5

party failed to make a showing sufficient to establish an element essential to that party’s case

6

on which that party will bear the burden of proof at trial. See Celotex Corp., 477 U.S. at 323–

7

24. If the moving party fails to meet its initial burden, summary judgment must be denied and

8

the court need not consider the nonmoving party’s evidence. See Adickes v. S.H. Kress & Co.,

9

398 U.S. 144, 159–60 (1970).

10

If the moving party satisfies its initial burden, the burden then shifts to the opposing

11

party to establish that a genuine issue of material fact exists. See Matsushita Elec. Indus. Co. v.

12

Zenith Radio Corp., 475 U.S. 574, 586 (1986). To establish the existence of a factual dispute,

13

the opposing party need not establish a material issue of fact conclusively in its favor. It is

14

sufficient that “the claimed factual dispute be shown to require a jury or judge to resolve the

15

parties’ differing versions of the truth at trial.” T.W. Elec. Serv., Inc. v. Pac. Elec. Contractors

16

Ass’n, 809 F.2d 626, 631 (9th Cir. 1987). In other words, the nonmoving party cannot avoid

17

summary judgment by relying solely on conclusory allegations that are unsupported by factual

18

data. See Taylor v. List, 880 F.2d 1040, 1045 (9th Cir. 1989). Instead, the opposition must go

19

beyond the assertions and allegations of the pleadings and set forth specific facts by producing

20

competent evidence that shows a genuine issue for trial. See Celotex Corp., 477 U.S. at 324.

21

At summary judgment, a court’s function is not to weigh the evidence and determine the

22

truth but to determine whether there is a genuine issue for trial. See Anderson, 477 U.S. at 249.

23

The evidence of the nonmovant is “to be believed, and all justifiable inferences are to be drawn

24

in his favor.” Id. at 255. But if the evidence of the nonmoving party is merely colorable or is

25

not significantly probative, summary judgment may be granted. See id. at 249–50.

Page 4 of 6

1

III.

DISCUSSION2

2

The Court of Appeals for the Federal Circuit, in Fresenius USA Inc. v. Baxter Int’l, Inc.,

3

721 F.3d 1330 (Fed. Cir. 2013), held that, “under the reissue or reexamination statute, … if the

4

original claim is cancelled or amended to cure invalidity, the patentee’s cause of action is

5

extinguished and the suit fails.” Fresenius, 721 F.3d at 1340. That is precisely the scenario

6

presented in the instant action. As a result of the reexamination of the ’935 Patent, all of the

7

original asserted claims of the ’935 Patent were cancelled in their entirety. (Reexamination

8

Certificate of the ’935 Patent 2:25, ECF No. 116-1). Moreover, as a result of the reexamination

9

of the ’982 Patent, all of the original asserted claims of the ’982 Patent were either amended to

10

cure invalidity or dependent on an amended claim. (Reexamination Certificate of the ’982

11

Patent 2:17–20, ECF No. 115-1; Reexamination File for the ’982 Patent at 88–89, 142, Ex. A-5

12

to Mot Summ. J.).

13

Therefore, based on the binding holding in Fresenius, because the asserted claims were

14

either cancelled or amended to cure invalidity during reexamination, the Court is bound to find

15

that Plaintiff’s cause of action is extinguished and the suit fails. Accordingly, the Court must

16

enter summary judgment in favor of Defendant and close this case.

17

IV.

IT IS HEREBY ORDERED that Defendant’s Motion to Vacate Injunctive Relief (ECF

18
19

No. 124) is GRANTED.
IT IS FURTHER ORDERED that Plaintiff’s Motion to Strike (ECF No. 135) is

20
21

CONCLUSION

DENIED as moot.

22
23
24
2

25

Defendant filed an Errata to its Motion for Summary Judgment. (ECF No. 129). Moreover, Plaintiff filed a
Motion to Strike Defendant’s Errata. (ECF No. 135). However, the Court does not rely upon Defendant’s Errata
in the disposition of the Motion for Summary Judgment. Accordingly, the Court denies Plaintiff’s Motion to
Strike as moot.

Page 5 of 6

1

IT IS FURTHER ORDERED that Defendant’s Motion for Summary Judgment (ECF

2

No. 123) is GRANTED. Accordingly, judgment is entered in favor of Defendant and against

3

Plaintiff.

4

The Clerk of the Court shall enter judgment accordingly and close the case.

5

30
DATED this _____ day of March, 2016.

6
7
8
9
10
11

___________________________________
Gloria M. Navarro, Chief Judge
United States District Judge

12
13
14
15
16
17
18
19
20
21
22
23
24
25

Page 6 of 6